As of August 1, 2026, the Company had restricted share unit (“RSU”) awards and performance-based restricted share unit (“PSU”) awards outstanding under the 2020 Equity Incentive Plan, as amended and restated from time to time (the “2020 Equity Incentive Plan”). The terms of each stock-based award are determined by the Board of Directors or the Compensation Committee at the time of grant and in accordance with the Company’s equity grant and settlement policy. As of August 1, 2026, the Company had 2.1 million shares authorized and available for grant under the 2020 Equity Incentive Plan.


(in millions)	2026		2025		2024
Restricted share unit awards(1)	$	41	$	33	$	33
Performance-based share awards	20		10		4
Share-based compensation expense recorded in Operating expenses	61		43		37
Income tax benefit	(17)		(12)		(10)
Share-based compensation expense, net of tax	$	44	$	31	$	27

Share-based compensation expense recorded in Restructuring, acquisition and integration related expenses	$	—	$	—	$	2
Income tax benefit	—		—		(1)
Share-based compensation expense recorded in Restructuring, acquisition and integration related expenses, net of tax	$	—	$	—	$	1

(1)Includes liability-classified awards of $14 million and equity-classified awards of $27 million for fiscal 2026, and liability-classified awards of $6 million and equity-classified awards of $27 million for fiscal 2025. Amounts recorded in fiscal 2024 are derived entirely from equity-classified awards.

Vesting requirements for awards are at the discretion of the Company’s Board of Directors or the Compensation Committee thereof. Time-based vesting RSUs issued to employees typically vest in three equal annual installments. Time-based vesting RSUs issued to non-employee directors have a minimum one-year vesting period. PSUs typically have a three-year cliff vest, subject to achievement of the performance objectives. As of August 1, 2026, there was $97 million of total unrecognized compensation cost related to outstanding share-based compensation arrangements (including RSUs and PSUs). This cost is expected to be recognized over a weighted-average period of 1.9 years.

The fair value of RSUs and PSUs are determined based on the number of units granted and the quoted price of the Company’s common stock as of the grant date. RSUs include liability-classified awards granted during fiscal 2025, that can or will be settled in cash. Liability-classified awards are remeasured at the end of each reporting period. The Company had liabilities for cash-settled share-based compensation awards of $14 million as of August 1, 2026, of which the entire amount was classified as current. The Company had liabilities for cash-settled share-based compensation awards of $6 million as of August 2, 2025, of which the entire amount was classified as current. Cash paid to settle liability-classified awards was $10 million, $0 million and $0 million for fiscal 2026, 2025 and 2024, respectively.


	Equity-Classified			Liability-Classified
	Number of Shares (in millions)	Weighted Average Grant-Date Fair Value		Number of Shares (in millions)	Weighted Average Grant-Date Fair Value
Outstanding at July 29, 2023	3.2	$	32.11	—	$	—
Granted	3.7	15.99		—	—
Vested	(1.5)	14.56		—	—
Forfeited/Canceled	(0.8)	10.42		—
Outstanding at August 3, 2024	4.6	22.66		—	—
Granted	1.2	26.26		0.9	26.18
Vested	(1.6)	23.70		—	26.59
Forfeited/Canceled	(0.5)	20.02		(0.1)	27.32
Outstanding at August 2, 2025	3.7	21.83		0.8	27.01
Granted	1.8	33.43		—	40.04
Vested	(1.4)	30.44		(0.3)	34.36
Forfeited/Canceled	(0.3)	39.69		(0.1)	37.59
Outstanding at August 1, 2026	3.8	$	26.26	0.4	$	45.30

During fiscal 2026, the Company granted 0.5 million equity-classified PSUs, included in the granted number in the above table, to its executives and other senior leaders (subject to the issuance of up to 0.5 million additional shares if the Company’s performance exceeds specified targeted levels) with a weighted average grant-date fair value of $34.86. These PSUs are tied to 3-year cumulative fiscal 2026, 2027 and 2028 performance metrics, including core adjusted earnings per share (“EPS”) and free cash flow. An insignificant amount of PSUs granted in fiscal 2026 were forfeited during fiscal 2026.

During fiscal 2025, the Company granted 0.5 million equity-classified PSUs, included in the granted number in the above table, to its executives and other senior leaders (subject to the issuance of up to 0.5 million additional shares if the Company’s performance exceeds specified targeted levels) with a weighted average grant-date fair value of $28.22. These PSUs are tied to 3-year cumulative fiscal 2025, 2026 and 2027 performance metrics, including core adjusted EPS and free cash flow. An insignificant amount of PSUs granted in fiscal 2025 were forfeited during fiscal 2026.

During fiscal 2024, the Company granted 0.8 million equity-classified PSUs, included in the granted number in the above table, to its executives and other senior leaders (subject to the issuance of up to 1.0 million additional shares if the Company’s performance exceeds specified targeted levels) with a weighted average grant-date fair value of $16.38. These PSUs were tied to fiscal 2024, 2025 and 2026 performance metrics, including core adjusted EPS and adjusted return on invested capital (“ROIC”). An insignificant amount of PSUs granted in fiscal 2024 were forfeited during fiscal 2026. Based on performance through the performance period ended August 1, 2026, 1.2 million shares underlying PSUs have been earned and will be issued in fiscal 2027.